London-based Prodigy Finance, a fintech company that provides postgraduate student loans to international students, announced that it has raised $500M (approx €426M) from CPP Investments. CPP invested the amount through its wholly-owned subsidiary CPPIB Credit Investments Inc.
The current round comes on top of a $250M that the company raised from the US International Development Finance Corporation (DFC), taking the total capital raised to $750M.
With the current round of funding, the company says, will allow it to meet the growing applications of international students which is up 50% year-over-over.
The funds will also enable the company to extend its offerings to students from many countries which were previously beyond its scope due to funding eligibility restriction.
With new countries being added, Prodigy Finance says it will now be able to cater to the needs of students from over 120 countries.
Some of the new countries and regions are China, Australia, Bangladesh, South Korea, Spain, Chile, Singapore, France, Germany, Italy, Japan, and most of South America.
The company mentioned in a statement that “China alone sends more than 100,000 students to the UK every year and more than 300,000 to the US, while US and Canadian schools see 57 per cent and 35 per cent respectively of students coming from the additional markets.”
Education loans for international masters students
When Cameron Stevens struggled to get a loan for his MBA in 2007, it laid the foundations for Prodigy Finance. According to the company, the founders recognised that traditional banks don’t serve the needs of international students. They require collateral, co-signers, guarantors, or documentation that international students simply don’t have. This is when they made it their mission to make quality education accessible, using fintech to redefine the student loan market.
Prodigy Finance runs on the philosophy that funding shouldn’t be a barrier to education. It is an online platform that offers community loans to international postgraduate students. The student borrowers gain access to higher education that they might not otherwise be able to finance, and the investing community earns financial and social returns through their investments.
Investors in Prodigy Finance include Index Ventures, Balderton Capital, and Credit Suisse.
Prodigy Finance’s recent growth
To date, the company has funded over $1B in graduate education loans to more than 20,000 students from over 100 countries. Prodigy Finance underwrites its loans based on its proprietary Future Earning Potential credit model.
Joel Frisch, Head of Global Acquisition at Prodigy Finance, says, “We have always believed that talent is borderless and finance should be too, so we’re thrilled to now be able to support students from all these additional countries. In total, we can now help students from over 120 countries worldwide and want to keep being a leader in helping global talent achieve its true potential.”
Recently, Prodigy Finance partnered with 12 new colleges in the US, taking the total count to 800 colleges and universities hosting 1000 postgraduate courses in their curriculum.